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01 February 2018

Facebook Ad Revenue Up 49 Per Cent As Publisher Revenues Fall

Facebook’s advertising revenue has risen by 49 per cent year-on-year, according to its full year financial results, while news media publishers - whose content powers engagement on social platforms - have seen their ad revenues fall by nearly 10 per cent.

Facebook published its fourth quarter and full year 2017 results yesterday, revealing that its global ad revenues had jumped by 49 per cent to $39 billion for the year ending 31 December.

According to eMarketer, Facebook will capture 18 per cent of the $266 billion global digital ad market this year, making it the number two ad publisher behind Google, which has a 31 per cent share, The Guardian reported.

Published by the Advertising Association/Warc on the same day, ad spend figures for Q3 2017 show that ad revenue for national and local newsbrands fell by 9.6 per cent on the same period the previous year.

Newswhip data has shown that news brands add significant value to the internet with nearly half of all engagements on UK content on social media powered by commercial news brands. Yet the revenue distribution does not reflect this cotntibution.

Separately, in a speech at the World Economic Forum in Davos, billionaire investor George Soros launched a stinging criticism at the “monopolistic” activities of Facebook and Google, telling the web giants their “days are numbered.”

He commented: “The fact that they are near monopoly distributors makes them public utilities and should subject them to more stringent regulations, aimed at preserving competition, innovation, and fair and open universal access,” Press Gazette reported.

“The internet monopolies have neither the will nor the inclination to protect society against the consequences of their actions. That turns them into a menace and it falls to the regulatory authorities to protect society against them.

“They exploit the data they control, bundle the services they offer and use discriminatory pricing to keep for themselves more of the benefits that otherwise they would have to share with consumers,” he added.

“This enhances their profitability even further – but the bundling of services and discriminatory pricing undermine the efficiency of the market economy”.

“Social media companies deceive their users by manipulating their attention and directing it towards their own commercial purposes. They deliberately engineer addiction to the services they provide. This can be very harmful, particularly for adolescents.”

“This may well result in a web of totalitarian control the likes of which not even Aldous Huxley or George Orwell could have imagined.”

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